Fairfax County Refunds $171 Million of Bonds

Fairfax County Refunds $171 Million of Bonds

On Feb. 6 Fairfax County sold $171.165 million in Aaa/AAA/AAA-rated
tax-free 10-year general obligation refunding bonds. The bonds were sold
to Lehman Brothers at a true interest rate of 2.72 percent. This rate is
naturally lower than the rates the county normally receives for 20-year
debt due to the shorter maturities of the 1993, 1994 and 1995 bonds that
were refunded. This interest rate is one of the lowest interest rates
achieved by Fairfax County since the first AAA rating was awarded by
Moody’s Investors Service in 1975. The refunding will result in savings
of approximately $12.8 million net present value of the bonds refunded.

The refunding bonds were sold to take advantage of current market
conditions and low interest rates in order to refund outstanding bonds
that have higher interest rates and are subject to redemption prior to
their stated maturities. The refunding bonds will fund an escrow account
and redeem the outstanding bond obligations at their earliest possible
call dates. Including this refunding, the county has refunded more than
$1.25 billion of the outstanding general obligation debt since 1989 for
cumulative net present value savings of approximately $60 million.

The county received four bids for the bonds with a high bid of 2.74
percent. The closeness of the bids indicates the highly competitive
nature and high quality of Fairfax County bonds in the market.

With this bond issue, Fairfax County maintains its status as a top rated
issuer of tax-free securities from Moody’s Investor Services, Standard
and Poor’s Corporation and Fitch Ratings. Fairfax County has the highest
credit rating possible for a local government - Aaa from Moody’s
Investors Service Inc., AAA from Standard and Poor’s Corporation and AAA
from Fitch Ratings. Only nine states, 23 counties and 15 cities have
Triple-A ratings from all three investor services. The credit ratings
enable Fairfax County to sell bonds at favorable interest rates compared
to those of municipalities not so rated, resulting in substantial savings
for county taxpayers over the life of the bonds. Since 1978, the county
has saved an estimated $173 million due to the benefits of the Triple-A
rating. With the addition of the $60 million in savings from the various
refunding sales, total savings are estimated at $233 million.

FAIRFAX COUNTY IS COMMITTED TO A POLICY OF
NONDISCRIMINATION IN ALL COUNTY PROGRAMS, SERVICES AND ACTIVITIES AND
WILL PROVIDE REASONABLE ACCOMMODATIONS UPON REQUEST. TO REQUEST SPECIAL
ACCOMMODATIONS, CALL 703-324-3187 OR TTY-703-324-2935. PLEASE ALLOW
FIVE WORKING DAYS IN ADVANCE OF EVENTS IN ORDER TO MAKE THE NECESSARY
ARRANGEMENTS